ibnlive » Business

Jul 17, 2009 at 12:43am IST

Govt to divest stake in 3 firms

New Delhi: The Government has identified three public sector units (PSUs) for disinvestments and plans an IPO for its leading fuel company, Oil India.

Sources tell Network18 the government will sell its stake in Karnataka-based Kudremukh Iron Ore, Maharastra-based Manganese Ore and Hyderabad-based National Mining Development Corporation (NMDC).

Sources says the Government is looking at disinvesting 9 per cent to 20 percent of Kudremukh Ore while 10 percent of Manganese Ore may be sold off via open offer.

Sources say between 8 per cent to 20 per cent of NMDC is to be disinvested. The Government is looking at disinvesting about five to 10 companies which have less than 10 percent of their shares traded on the market.

The Government also plans to disinvest its stake in PSU firms through Initial Public Offerings (IPO). The IPO for Oil India will open on September 7 and will close on September 11.

Oil India, the country's second largest state run explorer, will offer 2.64 crore equity shares through IPO and will use the money raised to fund its Rs 2,400 crore capital expenditure plan.

Simultaneously, the Government will sell 10 percent of its stake to Oil India. Post the IPO, the Government’ stakes will fall to 78.5 per cent from 98.13 per cent currently.